Big steel : the first century of the United States Steel Corporation, 1901-2001

__Big Steel__ is the first comprehensive history of the company at the center of America’s twentieth-century industrial life––the United States Steel Corporation. Granted unprecedented access to the U.S. Steel archives, Warren tells the compelling history of this business. At its formation in 1901, the United States Steel Corporation was the earth's biggest industrial corporation, a wonder of the manufacturing world. Immediately it produced two thirds of America's raw steel and thirty percent of the steel made worldwide. The behemoth company would go on to support the manufacturing superstructure of practically every other industry in America. It would create and sustain the economies of many industrial communities, especially Pittsburgh, employing more than a million people over the course of the century. A hundred years later, the U.S. Steel Group of USX makes scarcely ten percent of the steel in the United States and just over one and a half percent of global output. Far from the biggest, the company is now considered the most efficient steel producer in the world. What happened between then and now, and why, is the subject of Big Steel, the first comprehensive history of the company at the center of America's twentieth-century industrial life. Granted privileged and unprecedented access to the U.S. Steel archives, Kenneth Warren has sifted through a long, complex business history to tell a compelling story. Its preeminent size was supposed to confer many advantages to U.S. Steel—economies of scale, monopolies of talent, etc. Yet in practice, many of those advantages proved illusory. Warren shows how, even in its early years, the company was out-maneuvered by smaller competitors and how, over the century, U.S. Steel's share of the industry, by every measure, steadily declined. Warren's subtle analysis of years of internal decision making reveals that the company's size and clumsy hierarchical structure made it uniquely difficult to direct and manage. He profiles the chairmen who grappled with this "lumbering giant," paying particular attention to those who long ago created its enduring corporate culture—Charles M. Schwab, Elbert H. Gary, and Myron C. Taylor. Warren points to the way U.S. Steel's dominating size exposed it to public scrutiny and government oversight—a cautionary force. He analyzes the ways that labor relations affected company management and strategy. And he demonstrates how U.S. Steel suffered gradually, steadily, from its paradoxical ability to make high profits while failing to keep pace with the best practices. Only after the drastic pruning late in the century—when U.S. Steel reduced its capacity by two-thirds—did the company become a world leader in steel-making efficiency, rather than merely in size. These lessons, drawn from the history of an extraordinary company, will enrich the scholarship of industry and inform the practice of business in the twenty-first century. Contents 8 List of Illustrations 10 List of Tables 12 Preface 18 Introduction. Preeminent Size: The Economies and Diseconomies of Scale 20 Part One. The Gary Era 24 1. Origins: The Creation of the United States Steel Corporation 26 2. Early Years of Industry Leadership, 1901–1904 41 3. Judge Gary’s “Umbrella”: The Advantages and Disadvantages of a Managed Industry 51 4. The Changing Balance of Locational Advantage and Expansion: The Rail Trade and the Gary Project 70 5. Government, Business, and Industrial Development: The Cases of Birmingham, Duluth, and a Canadian Plant 83 6. Entrepreneurial Failure? Technological Backwardness, Constructional Steels, and the Universal Beam Mill 105 7. The Interlude of World War I 117 8. Labor Conditions and Relations during the Gary Years 125 Part Two. The 1920s, Depression, and Reconstruction 140 9. The Changing Shape of Competition and the End of the Gary Years, 1919–1927 142 10. ERW Pipe and the Wide Continuous Strip Mill: Instances of Delayed Innovation 151 11. Crisis and Response: The Achievements of Myron Taylor,1927–1938 162 12. Labor Relations under Myron Taylor and Philip Murray 183 13. New Regions: US Steel and the Changing Geography of the National Market 189 Part Three. Expansion, Prosperity, and Increasing Problems 210 14. Government-guided Growth: US Steel in World War II 212 15. Filling Out the Production Map: US Steel beyond Pennsylvania and the Great Lakes, 1945–1970 220 16. Triumph and Marking Time, 1945–1960 233 17. A Time of Transition, the 1960s 250 Part Four. Decline, Reconstruction, and Prospects 262 18. Response to a Technological Revolution: The Large Blast Furnace, Oxygen Steel Making, and Continuous Casting 264 19. Long-term Changes in Corporate Organization and Location 278 20. The National Steel Industry since 1970 298 21. The Chairmanships of Edwin H. Gott and Edgar B. Speer 314 22. The Rationalizing of US Steel after 1979 328 23. Labor on the Defensive during the Rationalization of the 1980s and 1990s 359 Conclusion. United States Steel in the Long View 366 Appendix A. StatisticalTables 376 Appendix B. Chief Officers of US Steel 386 Notes 388 Bibliography 410 Index 418

Big Steel is the first comprehensive history of the company at the center of America’s twentieth-century industrial life––the United States Steel Corporation.  Granted unprecedented access to the U.S. Steel archives, Warren tells the compelling history of this business.